Is it just me, or are mercenaries, pirates, and other human groups of the player's same level out in the world a little overpowered? I have run into several now that I can't even get close to, even if I'm 2 or 3 levels higher.

In general, yes. NPC groups are some of the deadliest things you can encounter in this game. Wizard Councils are particularly dangerous since wizards and conjurors have some really hard-hitting spells and devastating debuffs/crowd control spells that can murder you without you ever having a chance. I was (and still am) frustrated by these but I can tell you what I've found works most of the time.

First and foremost, the strategy that almost never fails, but requires a lot of resources as you'll need a lot of glass jars. Having multiple glass blowers in your clan helps for this (sidenote glassblower is probably one of the best professions you can find on a random npc). Use frost grenades, which you can get by picking up sheets of ice on the ground with glass jars. If you have a lot of jars, at least one frost grenade, and a puddle of water you can create a ton of ice potions by striking the puddle with the frost grenade and picking up the ice. One jar of ice creates multiple ice grenades and harvesting ice turns it into a puddle that can be immediately refrozen for more grenades. do this until you have around 40 grenades (2 full stacks).
Hot key your grenades, when you use one stack the hotkey will automatically start using the next stack. If you press the hot key your character will throw the grenade at your cursor's location after a short throwing animation. If you mash the hot key he will throw grenades at the rate you mashed the key after the throwing animation.
Knowing this, aggro the group safely and try to bunch them all up somewhat close to you and pause the game via pressing the "P" key so that there are no menus open. select an area where they will be after about a second of running and mash the hot key 20 times (the spare grenades are for tougher groups or if you encounter multiple groups before you can restock). When you unpause the game your character will throw all of those grenades at the same time and the resulting aoe is enough to kill most NPC groups. This does not work against NPC groups with a priest that cast frost resistance, or against NPC groups with a lot of members who know Ice armor.

If you cannot do this for whatever reason, here's what you should do:
To prepare to fight them for real you'll first want to make sure that you have your teleport stone ready. Basically if you have already used it you should prioritize recharging it as soon as the quest becomes available. You'll want consumable damage boosts (flaming weapons and acid dripping weapons) as well. If you don't already know you can get more of these by using an empty glass jar on oil/lava pools and acid pools respectively.

Priests are enormously useful for fighting groups. Priests know (or can know in the case of NPCs) resistance spells that let you personally counter certain types of enemies. Priests also have massive buffs for either vitality or attack and crit rating. Wizards are also noteworthy for Fireshield so you can reflect damage right back at attackers. You don't need these buffs from your clan, but they are enormously helpful.

Also assuming you already know what the group is you'll want resistance potions to counter them (you should be stockpiling these as you find them rather than selling or salvaging them).
I'm not completely sure of some of the group make ups, I've encountered groups with these members in them but some of them might have been NPCs not associated with the group, but in general:
For all groups: Vitality Elixirs
Mercenaries (consists of all warriors): nothing in particular
Cults (Priests and possibly deathknights and conjurors): Fire/lightning resist
Pirates/Thieves guilds/assassins guilds (all rogues): poison resist
Wizard Circles (wizards and conjurors): Fire and Ice are most important, followed by lightning and magic.
Vigilantes (I've only encountered these with warriors, rogues, and hunters): poison but also watch out for hunter traps.
Druid Circles (Rangers, druid abilities only): poison (nature's fury is no joke) but watch out for sky high physical damage from shapeshifting and earthquake spam.

The best way to fight them is to control them so you don't have to fight all of them at once (or if you are a death knight who doesn't have a large aoe stun/daze use dark cloud so that they can't use abilities). Be sure to clear the area around them because you'll need room to move around. Try to constantly back pedal to force the AI to miss attacks. Even as melee, run in make a couple of hits, then back up. If you have damage over time effects, even better.

Be aware of what their abilities do. There is a pool of abilities each NPC can draw from (same pool your clan members can draw from) so you should be familiar with what each one does. In particular learn which ones cut your mobility (firestorm, caltrops etc.) and what they look like when used. Try to kill the npcs that know those first. Not getting hit by all of them at once is how you'll beat them and you can't do that if you are constantly being slowed/rooted/stunned. If you are a squishier class watch out for savage strike (warrior ability that teleports them to their target) as it has no cool down and they will spam it if you keep back pedaling away from them.

Contrary to what you might think, you want followers with high single target dps, and not AoE damage abilities (AoE debuffs are great, though). Followers with AoE damage attacks will pull most of the group of you and they aren't smart enough to back up to not get hit, which means that they will usually die as multiple NPCs will have no trouble out-dpsing even your best potions. You'll want followers who can engage one person each and win their fights (or at least not lose) with potions being the only help you give them. The exception to this are followers with firestorm or tornado as they (when combined with your abilities) can keep enemies controlled for a long time.

This ended up a little longer than I thought it would, but I hope it helps.